Combating Money Laundering: Strategies for Governments

A number of places have participated with the International Monetary Fund's campaigns to circumvent the network of individuals who perform money laundering. Numerous member nations are aided by the IMF in proper identification of criminals and also apprehending them to avoid transfer of money that go into much more criminal practices just like arms-and-drug-dealing, all types of terrorism as well as corruption, among others. Money laundering is undesirable as the funds comes from unlawful means and is used to support and finance crooks and perhaps also terrorists. Crooks hide their loot to prevent proper authorities from monitoring their modus operandi and their hierarchies thru serial numbers found in money. One of the ways that IMF member countries perform is to build anti-money laundering commissions or intelligence units in banks, organizations and also other financial institutions that help identify suspicious activities. Furthermore, people or companies that are found dealing with shady organizations and people are prohibited from transacting with banking institutions and in turn, banks that are identified to work with criminals and shady people are penalized or risk being removed of their license to operate. An example in the news just recently is Standard Chartered Bank in New York City, which was apparently identified to be channeling money to banned individuals and organizations from Iran. This criminal practice not only funds unlawful activities but it also causes an imbalance in the money market supply, that could probably bring about financial collapse for an economy, if crooks were still left to operate with out being apprehended. Another approach to control this practice is to firmly implement accounting, auditing and also tax payment for all forms of businesses, institutions and enterprises. Accountants and also auditors could report shady discrepancies to proper authorities and stop this from happening. Additionally, restricting the amount of money that individuals bring overseas is also another method to avoid it. Individuals who need to bring much more must state exactly where and what precisely they'll use the funds for. Considering that there are also methods how money launderers could convert hot or dirty money into clean ones, big dealings must be reported even for transactions involving electronic currency or points. This practice is multi-factorial and it includes many criminal and even legal businesses that work as front businesses to people who make money from improper techniques. Also, the crackdown for money launderers was improved because most terrorists can operate simply because cash from legitimate enterprises overseas is channeled to them through banking institutions. Somehow, criminals find lots of methods to bend the laws, perhaps by extortion and threat. Money laundering is really something that many people should be careful enough to report to respective authorities. It's also attributed to the rise of terror exercises brought on by radicals, extremists and other individuals who aim to destabilize governments. Several countries are unsuccessful mainly because there is little political will to have this practice totally abolished. While nations such as the US, Canada and Australia have been known to sanction and punish reporting companies, banking institutions and establishments who violate anti-ML laws, many little countries can't implement their own AML legislation and this is the reason why this practice is still very rampant in some countries despite the international community's perceived vigilance.